THE ENERGY COMPLEX: REFORMS BEGIN

THE ENERGY COMPLEX: REFORMS BEGIN

Anatoly Chubais, chairman of Russia’s United Energy Systems, will undertake the reorganization of the energy complex in the Trans-Volga region. RUES will create the new company, Volgaenergo.

Chubais himself repeated several times at a conference in Nizhny Novgorod that he knew and understood the risks involved in the reorganization. All of the participants at the conference expressed surprise when the new general governor of the Trans-Volga region, Sergei Kirienko, endorsed Chubais’ proposal.

Chubais emphasized that he planned to support the region, because its energy complex was one of the best developed and most progressive in the country. The company Samaraenergo, a subsidiary of RUES, is an absolute leader in making payments with “live money” (i.e. cash). During the last two months, the share of “live money” in Samaraenergo’s payments amounted to 104 percent (four percent of the payment was used to pay the company’s debts.)

Samaraenergo General Director, Vladimir Avetisjan: “The company devised a strategy of ‘live money’ collection last autumn. All customers were split into categories: large enterprises that require a heavy supply of energy, budget organizations and individual customers. Certain measures were taken with our clients. First, we threatened to turn off the power in the event of payment arrears and then we actually shut it off. Finally, where necessary, we initiated bankruptcy proceedings. Finally, customers realized that we would follow through with our threats and they started paying us in cash.”

As always, speaking on behalf of the government, Deputy Energy Minister Viktor Kudryavy condemned Chubais’ plans. Kudryavy believes that state regulation should be imposed on the energy complex and he opposes the recommendations of RUES top management to free market prices for energy. Chubais asked Kudryavy how the state could afford to develop the energy industry. The rough estimates of the Economy Ministry indicate that at least $40 billion would be needed.

Kudryavy: “In absolutely every country of the world, the money can be found in the wallets of energy users.”

Chubais then suggested to the governor that the tariffs for users be raised five times, because this was the only means to collect the needed $40 billion. Everybody agreed that such an action was impossible.

THE JUSTICE MINISTRY HAS FORMED ITS TERRITORIAL STRUCTURES IN SEVEN FEDERAL REGIONS

Izvestia, July 20, 2000, p. 3

The Justice Ministry has always tried to defend its status and influence, but its efforts have been futile. There was a time when Chuvash President Nikolai Fedorov fought tooth and claw to attain a higher status for the ministry. Yuri Kalmykov also struggled to enhance the status of the ministry, but he ended up spending most of his time working on specific projects, like the Civil Code. Nikolai Kovalev also failed. That is why, when Yuri Chaika was assigned to the Justice Ministry from the General Prosecutor’s Office, observers decided that this was the beginning of the end of Chaika’s career. The former acting general prosecutor will try to prove them wrong.

Chaika is determined to bring all the regional legislators in line with the federal government. He will tolerate no deviations. That is why he is promoting the idea of an interdepartmental commission for monitoring constitutional legality within the Justice Ministry. Actually, Chaika seems to have deliberately ignored the fact that these problems are handled by the prosecutor’s office and the Constitutional Court.

He also intends to expand the ministry’s prerogative to the evaluation of regional acts and documents. According to the Justice Ministry, Bashkortostan, Tatarstan and Kalmykia never send their acts to the federal center for evaluation.

When the first results of the work are evident, we will see how successful Chaika has been.

THERE IS A WIDESPREAD OPINION IN KARACHAEVO-CHERKESSIA…

Izvestia, July 20, 2000, p. 3

… that the latest rallies, in which protesters demanded the resignation of Vladimir Semenov, were arranged by Boris Berezovsky and his followers.

On Wednesday, the Karachaevo-Cherkessian government released a statement accusing the organizers of the July 18 rally of having attempted to destabilize the situation. The republican authorities branded the rally as “the criminal attempt of political adventurers to deliberately aggravate the situation in the republic for the sake of provoking a reaction from the federal center.” The term “political adventurers” apparently is in reference to Berezovsky and his followers. According to the statement, the rally was merely a “PR trick of Karachaevo-Cherkessian deputy Berezovsky.” The organizers of the rally never bothered to request permission to stage their protest

Irina Myagkova, press secretary for the administration of Karachaevo-Cherkessia, reported that the situation in the republic and its capital is now quiet. The rally is over and the cordons were called off.

Many local observers believe that Berezovsky is in the process of carrying out a complex strategy. According to Myagkova, it is widely believed in the region that the attempts of Stanislav Derev, to destabilize the situation and thus compel Semenov to step down, have failed. Derev is regarded as Berezovsky’s political tool.

Myagkova: “Berezovsky might be using Derev to realize his ambition to become the leader of Karachaevo-Cherkessia.”

GUSINSKY QUESTIONED AGAIN

Moskovsky Komsomolets, July 20, 2000, p. 2

Investigator Nikolayev summoned the media magnate to questioning in order “to clarify some points.” Vladimir Gusinsky’s lawyer Astakhov predicted that additional restrictive measures would be applied against Gusinsky.

The other day, Nikolayev assured everybody within earshot that the restrictions on Gusinsky’s activities would not be lifted. Immediately following the questioning, all of Gusinsky’s worldly assets were confiscated.

A CHECHEN UPDATE

Moskovsky Komsomolets, July 20, 2000, p. 2

The latest developments in Chechnya resemble the events that took place in the wake of the Khasavyurt agreements. The fact is, several parallel centers of local power have emerged. Bislan Gantamirov is apparently the scapegoat.

Recent events resemble an adventure novel. Gantamirov’s men (around 200 of them) drove some armored personnel carriers to Gudermes and surrounded the administrative building. Gantamirov got out of his Jeep and met with Kadyrov. The conversation was brief. Gantamirov and his armed entourage left for the Chechen capital again. The conflict broke out, because Gantamirov had disagreed with the dismissal of some of the heads of district administrations in Grozny. Russian generals had to intervene to prevent the situation from further deteriorating.

Yesterday, Gantamirov was charged with “anti-constitutional actions against the Russian president,” after having openly challenged Kadyrov. Sergei Arenin, head of the Interior Ministry Directorate for Chechnya, initiated an investigation into the participation of Chechen policemen in the “demonstration of force.” Chechen policemen are supposed to obey Arenin. Gantamirov is not a senior deputy head of the Chechen administration yet, because the order was never signed.

Gantamirov also decided to flex his muscles and organized a “parade of combat detachments” in Grozny. The Kremlin now has to choose between Kadyrov and Gantamirov.

YUSUP SOSLAMBEKOV’S CONDITION REMAINS SERIOUS

Nash Vek, July 20, 2000, p. 2

Yusup Soslambekov, Chairman of the Confederation of Caucasus Peoples, remains in serious condition. Yesterday, he was the victim of an assassination attempt.

Aleksei Iskandarjan, Director of the Center of Caucasus Studies, believes that the attempt on Soslambekov’s life was a result of the discord within the Chechen diaspora, which has arisen on account of the conflict between Akhmed Kadyrov and Bislan Gantamirov in the Chechen administration. Iskandarjan rejected speculation that the assassination was organized by Basayev. In his view, Basayev “has other matters on his mind. If Basayev planned an assassination, he would go after bigger game.”

Soslambekov was born to a family of Chechen settlers in Kazakhstan in 1956. In 1990, he became one of the leaders of the Vainakh Democratic Party of Chechnya. Soslambekov castigated the federal center during the first Chechen war. In 1996, he became chairman of the Confederation of Caucasus Peoples, an organization which played a crucial role in the Georgian-Abkhazian conflict. Soon afterwards, however, the organization began to lose whatever respect it had formerly commanded. The idea of a sovereign mountainous state in the Caucasus was untenable and the war in Chechnya split the Confederation into factions.

THE GOVERNMENT DETERMINED THE AVERAGE MONTHLY SALARY IN THE SECOND QUARTER OF 2000 AT 1,256 RUBLES

Trud, July 20, 2000, p. 3

The average monthly salary will provide the basis for calculating the state pensions as of August 1. The governmental resolutions cited figures, which greatly differ from the actual average salaries.

UKRAINIAN PREMIER VISITED MOSCOW

Komsomolskaya Pravda, July 20, 2000, p. 3

Ukrainian Premier Viktor Yuschenko visited Moscow yesterday in order to persuade Russia to give Kiev more time to pay its gas debts.

Officially, the debts amount to $1.5 billion. If the amount of gas that Ukraine has simply stolen is calculated, the total of the country’s debts is approximately $3 billion.

Not so long ago, the Russian government was compelled to resort to threats in its discussions with Ukrainian authorities on this subject. In essence, either Ukraine pays its debts or Moscow will build a new pipeline via Belarus. The construction of the pipeline would result in a drastic reduction of gas transit via Ukraine.

Yuschenko was received by his Russian counterpart at the governmental residence Volynskoye. Apparently, the meeting was informal. However, according to observers, Kasyanov took an uncompromising position with Yuschenko.

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